Value demand for guar gum is forecast to expand 7.1 percent yearly through 2021 to $120 million, according to a new report of the Freedonia Group, a Cleveland-based industry research firm.
Overall growth of the industry is expected to be slower than the growth seen between 2011 and 2016, despite recovery in volume demand, as pricing undergoes a correction from the double-digit gains seen during the same period. However, prices will remain high, as feedstock supplies remain limited.
Volume demand for guar gum is forecast to recover from the minor losses registered between 2011 and 2016, expanding almost 2 percent yearly to 53 million pounds in 2021. These gains will be driven primarily by reduced use of guar gum in oilfield applications, resulting from falling oil drilling in light of low oil prices. “In turn, more guar gum will become available for food and beverage applications,” opined analyst Christine O’Keefe. Stronger growth will be restrained by the continued high prices, despite slowing increases in pricing.
Baked goods are the largest market for guar gum, accounting for 35 percent of overall value demand in 2016. Guar gum is frequently used in gluten-free baked goods, where it helps produce an appealing texture and retains moisture. Guar gum is also a high fiber product, although the amount used typically does not add significant amounts of fiber. Through 2021, baked goods are forecast to post the slowest growth, expanding just over 5 percent yearly to $39 million, as demand slows for gluten-free foods.
